Housing Starts Plummet, Government Plans New Strategy for 300,000 Homes

New housing commencements in Ireland have dropped to their lowest level since the Covid-19 lockdowns, raising concerns about the Government’s ambitious goal of delivering 300,000 new homes by 2030. According to data from Construction Information Services (CIS), housing starts fell by 49 percent year-on-year in the third quarter of 2025, despite planning approvals reaching record highs.

The statistics reveal a “significant disconnect between approved developments and actual construction activity,” as noted by CIS. In the third quarter, 197 residential developments worth €3.4 billion received planning permission, representing a 46 percent increase year-on-year and covering approximately 13,500 homes. Yet, actual construction commencements dropped by nearly half during the same period.

Key Developments Amid Declining Starts

While the overall trend is troubling, some major projects did commence. Notably, a €166 million Strategic Housing Development in Balbriggan will provide 817 units. However, CIS pointed out that “overall commencement volumes remain constrained.” The most significant planning approval in the quarter was for the €646 million Holy Cross development in Dublin, featuring 1,131 apartments.

The data suggests that the development levy waiver introduced last year spurred significant activity in 2024, but it has since led to a sharp decline in housing starts for 2025. This waiver, which temporarily suspended local authority residential contributions, is set to remain in effect until December 31, 2024. Alongside the waiver, the Uisce Éireann water connection rebate, which refunded water and wastewater connection charges, contributed to the trend.

Many developers reportedly submitted commencement notices for more units than they intended to start in order to benefit from these waivers. “The substantial shift in housing starts following last year’s levy-driven activity highlights how policy interventions can create volatility in the construction pipeline,” stated Dave Thompson, Vice President for UK and Ireland at CIS. He added that this situation presents considerable challenges for meeting Ireland’s housing delivery targets.

Government’s New Housing Plan on the Horizon

These figures come as the Government prepares to unveil its new housing plan, titled “Delivering Homes, Building Communities.” This plan will include a commitment to deliver 90,000 starter homes over the next five years and an additional €2.5 billion in funding for the Land Development Agency. The Government has pledged to ensure that more than 300,000 new homes are delivered by the end of 2030.

In addition to residential projects, CIS’s report indicates a similar decline in the non-residential construction sector. A total of 587 projects worth €1.8 billion received planning permission, but the value of projects moving into construction decreased by 22 percent year-on-year, dropping to €92 million across 394 sites.

In Dublin, new investment fell by nearly 64 percent compared to last year. In contrast, the mid-east and south-west regions led construction activity, with values of €204 million and €196 million respectively.

As the Government prepares to address these challenges, the construction sector will be watching closely to see how new policies affect future housing developments and meet the growing demand for homes in Ireland.